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Question
Given the returns for two stocks with the following information, calculate the covariance of the returns for the two stocks. Assume the expected return is 14.4 percent for Stock 1 and 15.9 percent for Stock 2. Round your final answer to five decimal places.
Prob Stock 1 Stock 2
0.5 0.11 0.18
0.3 0.17 0.15
0.2 0.19 0.12
A) 0.00120
B) 0.00054
C) -0.00079
D) -0.33720
Answer
This answer is hidden. It contains 113 characters.
Related questions
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The claim lenders' hold on cash flows in a company with outstanding risky debt is often thought of as:
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Q:
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Q:
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A) True
B) False
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Consider a call option on a stock with a strike price of $60. If the stock price at expiration is $50, the payoff from the call option is $10.
A) True
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